CGS successfully helped a subsidiary of a Fortune 50 Company compliantly and profitably perform work in Iraq after the second Gulf war. Our client was a large Engineering and Construction (E&C) Firm with a large US and international presence. Our client was also the subsidiary of a public company that had recently experienced a very significant and public ethical failure by its senior management.
Accordingly, the new Corporate Executive Management team was particularly, and rightly, concerned about undertaking any work in Iraq where fraud and malfeasance ran rampant. Any further missteps by the Company would further tarnish its image with the public, investors and the SEC.
To minimize the compliance and financial risks, our client hired us to audit all of their invoices before they were sent to the government. Our scope included auditing both our client’s actual costs as well as those of the subcontractors. We audited roughly two years of invoices totaling over $300M.
Our work included verifying the all of the significant direct costs; ensuring that the correct overhead rates were applied; confirming that the appropriate fee %’s were used; etc. Based on our work, we were able to identify various non-billable costs (e.g., black market hand guns) thereby avoiding any non-compliance issues as well as saving our client from potential embarrassment. Relying on our work, our client was able to confidently bill the government and collect every penny that they billed. Neither the Defense Contract Audit Agency (DCAA) nor the Army took any exceptions to our client’s invoices – in stark contrast to the many public billing disputes that other contractors experienced.
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